Any business thrives on a strong cash flow as well as in industrious employees. And the way to get the latter is to keep employees well-compensated and happy. They must get what is due to them so that they will continue to work hard and become efficient and productive workers.

To get that, avoid these 10 common mistakes in preparing payroll.

Take note of deadlines. Report and deposit payroll taxes on time. Do not miss such deadlines because even the slightest delay can already result to penalties. So it is important to mark your calendar and be constantly aware of the important dates.

Remember to a 1099 form to independent contractors who are able to receive at least $600 in a year. This is to be done every January 31st of the coming year.

Always make accurate and correct data records. Do not mismatch the personal details of your employees including their Social Security Number and names.

Make sure the handling of garnishments as well as of child support owed by certain employees are taken care of in the payroll.

Make sure overtime pay rates follow rules. When mistakes lead to litigation, it will become even more expensive.

Do not leave everything to your payroll software. The problem with some payroll masters is that they assume the accounting software small business will recognize mistakes in their inputting. The fact is it does not. So it is still necessary to make sure your entries are accurate.

Do not get rid within 4 to 6 years your copies of timesheets, canceled checks, and W-4 forms.

Keep confidentiality of payroll information. These should not be divulged to people outside of the payroll department, even if they are still employees of the company.

Keep at least two people to do the payroll work. In cases when one of them gets sick or leaves work, at least there is still one other person who can fulfill the requirements. Remember that the IRS will not take any excuse for late submissions as there are people waiting to receive their salaries.

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